Owens Realty Mortgage, Inc. Reports First Quarter 2017 Financial Results

WALNUT CREEK, Calif., May 9, 2017

First Quarter 2017 Financial Highlights

• Net income attributable to common stockholders of $191,678, or $0.02 per fully-diluted common share
• Book value attributable to common stockholders of $20.97 per common share at March 31, 2017 as compared to $21.03 per common share at December 31, 2016
• Declared quarterly dividends of $0.08 per share of common stock

First Quarter 2017 Operational Highlights

• Originated five new loans in the quarter totaling $14,943,000 (note amount) and received full or partial payoffs on eight loans totaling $8,695,000
• Average balance of performing loans for the three months ended March 31, 2017 as compared to the three months ended March 31, 2016 increased by approximately 29%
• Sold two real estate properties for net proceeds of $872,000 resulting in an insignificant loss

Subsequent Events

• In April 2017, the Company sold the approximately 8.0 acres of land and entitlements, including related parking and garage structures, owned by Tahoe Stateline Venture, LLC located in South Lake Tahoe, California for net sales proceeds of approximately $42,300,000, resulting in a gain of approximately $13,200,000

"The first quarter's results were significantly affected by the timing of our lending activity. Although we cannot predict loan originations in a given period, the first quarter of the year has historically been slow. In addition, as of quarter end, we had many loans in the pipeline delayed for a variety of reasons, primarily related to borrowers. Also, our net income from real estate was lower than expected due primarily to a one-time charge and the effects of weather on our golf course asset. However, with the recent sale of the land held within Tahoe Stateline Venture, LLC, we have positioned the Company to capitalize on lending opportunities in the near term which would be further enhanced by sales of other real estate" said Bryan Draper, the Company's CEO.

Summary of First Quarter 2017 Financial Results
The Company reported net income attributable to common stockholders of $191,678, or $0.02 per fully-diluted common share, for the quarter ended March 31, 2017 as compared to net income of $4,734,262, or $0.46 per fully-diluted common share, for the quarter ended March 31, 2016. The decrease was primarily a result of the following:

• A decrease in gain on sale of real estate of $4,839,000 for the quarter ended March 31, 2017 due to the sale of two properties during the quarter ended March 31, 2016 with gains totaling $4,839,000 as compared to the sale of two properties during the quarter ended March 31, 2017 that resulted in an insignificant loss.
• A decrease in rental and other income from real estate properties net of expenses on such properties of $573,000 for the quarter ended March 31, 2017 (from income of $6,000 in 2016 to loss of $567,000 in 2017) as a result of the sale of four operating properties during 2016, a one-time increase in property tax assessments levied on our property located in Tacoma, Washington of $170,000 and decreased revenue on our golf course located in Auburn, California as a result of inclement weather in Northern California. Many of the remaining properties held by us are non-operating properties that do not generate income and, thus, will likely continue to generate a loss until they are disposed of in 2017 and beyond.
• An increase in management and service fees of $199,000 for the quarter ended March 31, 2017 due to an increase in the average balance of loans in the Company's portfolio of 24% between the quarters ended March 31, 2017 and March 31, 2016.

These items that decreased net income during the three months ended March 31, 2017 were partially offset by the following: